Asian Sky Quarterly 2023 Q4
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GLOBAL BUSINESS AVIATION MARKET UPDATE<br />
OEM BACKLOGS<br />
<strong>Q4</strong> Backlog at Major Business Jet OEMs<br />
USD Millions<br />
$32,178<br />
Bombardier Gulfstream Cessna<br />
$40,277 $40,957<br />
<strong>Q4</strong> 2021 <strong>Q4</strong> 2022 <strong>Q4</strong> <strong>2023</strong><br />
viii<br />
Dassault and Embraer have not report quarterly result, so is not include in this graph.<br />
OEM backlogs increased 1.7 percent year-over-year in <strong>Q4</strong> <strong>2023</strong> to<br />
USD 41.00 billion (excluding Dassault and Embraer). Orders were<br />
lower than the high levels seen in late 2021 and early 2022 but were<br />
in line with <strong>Q4</strong> 2022 and pre-COVID levels. Supply chain and labor<br />
constraints continued to prevent OEMs from increasing production<br />
levels in <strong>Q4</strong>, even as revenue increased due to strong pricing. Stable<br />
orders and the inability to increase production resulted in a bookto-bill<br />
ratio of 1-to-1 in <strong>Q4</strong> and OEMs expect book-to-bill ratios to<br />
remain around 1-to-1 in 2024.<br />
TRANSACTIONS ($ VOLUME)<br />
$32.3B<br />
(3,964 Units)<br />
YTD Business Jet Transactions<br />
New Pre-Owned Total<br />
$36.4B<br />
(3,543 Units)<br />
$32.2B<br />
(3,006 Units)<br />
Volume<br />
$16.7B<br />
(3,243 Units)<br />
$20.3B<br />
(2,851 Units)<br />
$16.4B<br />
(2,304 Units)<br />
$15.6B<br />
(721 Units)<br />
$16.1B<br />
(692 Units)<br />
$15.8B<br />
(702 Units)<br />
<strong>Q4</strong> 2021 <strong>Q4</strong> 2022 <strong>Q4</strong> <strong>2023</strong><br />
YoY % Chg<br />
21.6%<br />
12.7%<br />
3.2%<br />
-1.8%<br />
-19.3%<br />
<strong>Q4</strong> 2022 <strong>Q4</strong> <strong>2023</strong><br />
Note that <strong>Q4</strong> <strong>2023</strong> figures reflect preliminary data and may increase as more transactions are reported to the FAA and data providers.<br />
-11.6%<br />
ix<br />
Both the new and pre-owned markets declined in <strong>2023</strong> compared<br />
to previous year levels. In the new aircraft market, manufacturers<br />
worked to resolve supply chain and labor constraints to boost<br />
production. Despite overcoming many issues, challenges persist<br />
in acquiring key components and hiring enough labor to meet<br />
demand. As a result, unit volume ticked up slightly, but not at<br />
the rate manufacturers planned, and dollar volume declined.<br />
While these constraints have lowered overall transaction volume,<br />
fewer new deliveries may help limit inventory growth and support<br />
healthier values for the market.<br />
Much of the decline in the pre-owned segment was expected as<br />
economic uncertainty increased and growth slowed while the business<br />
jet market normalized following a strong 2021 and 2022. In addition,<br />
inertia between sellers looking to maintain post-pandemic value gains<br />
and buyers waiting for values to return to historical depreciation levels<br />
slowed transaction volume in the pre-owned market. Relatively steep<br />
inclines in interest rates also suppressed demand. Heading into 2024,<br />
new deliveries may increase with the certification of new aircraft<br />
models while pre-owned transactions should remain largely stable as<br />
buyers and sellers continue to acclimate to a new market dynamic.<br />
FOURTH QUARTER <strong>2023</strong> — ASIAN SKY QUARTERLY | 38
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